america. if you look at the s&p, winners include advanced micro devices, netflix, apple and monster worldwide. at least those stocks are ending the day or the year, i should say, on a high note. david: as i always do, i've got apple myself, i without into it. why did it take off so much today? even before this rally began to pick up, apple was up over 4%. >> reporter: what you have to keep in mind, dave is it's been a lousy few months for apple. the past three months, that's actually been down about 20% and even for the month of december didn't do as great despite the holiday shopping season. so we are seeing the stock now get a bump, and that's both an expressive sort of bounce on apple, also a look ahead to 2013. a lot of markets are talking about expectations for 2013, and there's the closing bell, guys. liz: seven, six, five, four, three, two, one, and happy new

year. as we close the book on 2012. gains for all three major indices over the past 52 weeks as the bells ring on wall street, minds on both washington and the rally on your screen 170 points for the dow jones industrials. and look at the 2% gain for the nasdaq, even better for the russell 2000. david: okay. i'm guessing now, unless the producer tells me otherwise, we are ending at the day's highs or very chose to it on both the nasdaq and the dow. gold also shining today and, of course, for the year. for the session gold gained almost $20 to end the year at $675 an ounce. the commodity $-- 1675 an ounce. this is the 12th consecutive yearly rise for gold. it was, however, the smallest yearly gain since 2008. liz: look at silver. silver a big story today, ending in the between for 2012 as well. the commodity gaining 8.3% over the past 52 weeks finishing at $30.23 an ounce.

david: now, on the other hand, not all commodities did well. oil did not have such a stellar year. today, of course, crude rallied 1.1% settling at $91.82 a barrel, but for the year oil fell 7.1%, about $7. liz: some of the best performing exchange-traded funds, they're very popular now. the sas, three-time bullish eff, and you know financials were the best performing sector at least for the s&p 500, and look at this, this etf more than 81%. there's also the home construction etf, of course, housing looking healthier up nearly 77%. and here's one that we don't often talk about, it's the tur. what is it? this is a turkey market etf, david, up more than 61%. david: turkey did pretty well. i'm glad they didn't part of your financials and consumer discretionary were the best performing sectors for the year. utilities were the only sector,

though, ending in the red for 2012. liz: and finally, for the year the dow jones industrials with the 30 stocks many of you own in your portfolios up 7.3%. s&p, nice move here, 13.4%. the russell up 14.6%, the big winner for the year, you see it on the screen, the nasdaq up 15.9%. not bad at all. all eyes on the approaching fiscal cliff with just under eight hours left to make a deal. we've got you covered from capitol hill, we're going to be speaking live with congressmen from both sides of the aisle, representative tim hulz camp, mick mulvaney and dennis kucinich. david: also wilbur ross, chairman and ceo of -- [inaudible] and the former chairman of the white house council of economic advisers. i tell you, we get the prime guests right here. ed lazear says tax hikes hurt growth. find out just how much. liz: rich edson live on capitol hill with the very latest on the

fiscal cliff countdown. larry shover live in the pits of the cme, and what action we saw, wow, and we've got more than $100 billion worth of advice from our market panel, bill greiner and sandy lincoln. but first, let's talk to rich edson and, rich, you know, you're looking at a situation at the moment where you have the president saying we're close, but no deal. you have senator mitch mcconnell on the republican side saying close, but no deal. leads me to ask, what about joe biden? our vice president? he's the one who kind of brought things together in the early morning hours. >> reporter: he did, and mitch mcconnell called vice president biden, and they were hammering out a deal almost to the point where the senate minority leader said when he woke up this morning he thought they did have a deal, at least on the tax portion. republicans saying they have worked out and reached agreement on the tax issues, the problem are the automatic spending cuts, the $94 billion known oz the sequester throughout 2013.

the white house wants to pull back on those cuts, republicans want to replace those cuts with other cuts. first, let's take a look at what they've agreed to. this is the framework on taxes. it exempts income of $400,000 for individuals,450 for families. capital gains and dividends stay the same underneath those amounts, for amounts above that, 20% on those taxes. the alternative minimum tax, the estate tax goes to 40% with all amounts of less than $5 million exempt from that tax. a one-year extension of long-term unemployment benefits, and you're also talking about a little more spending when it comes to the doc fix. actually, it's a lot more spending, but something congress does every year. that's to make sure that medicare patients don't get a fairly dramatic pay cut every so often. in this case it would be at the beginning of this year. there is no debt ceiling as part of this, that's designed to help house republicans vote for this. that was a big sticking point

for them. they say with the debt ceiling they can extract more government spending cuts, so that's a fight that will live to see another day. so they are close and, in fact, reached an agreement on these tax portions here. it's just those automatic spending cuts democrats and the white house want to delay those cuts or offset those costs for a few months or possibly a year. republicans say we're fine with delaying those cuts, you just have to come up with other government spending consistents to offset the cost of pushing back those cuts. david: we're just getting late-breaking news from roll call, the president saying eventually he's going to be asking for each more taxes going up. what's the latest on this? >> reporter: i just heard of that as you reported it to me, david, but it's basically consistent with what the president wants when you talk about just this particular revenue portion. what you would get from raising taxes on individuals making $400,000 a year isn't all that close to what the white house wants, the more than $1.5 trillion over tax increases over

the next decade. so taxes and spending will continue to be a fight between democrats and republicans even if they ink this teal tonight and it takes it through congress. liz: rich edton, live from d.c., thank you so much. david: let's go down to bill greiner, mariner wealth adviser's cio, sandy lincoln is vmo global asset management u.s. chief market strategist, and larry shover live in the pits of the cme. larry, we mentioned housing when we came in. nobody saw a year ago housing taking off great guns the way it has. is there one area, maybe one sector that you would look at for 2013 to be the surprise takeoff stock or sector for 2013? >> yeah. for me it would be definitely financials. and it's just going to continue to go just like it did this past year, because i think we're all -- including the market -- completely underestimating the tailwinds that the recovering housing market's going to have. even like the median estimates

for next year is housing's going to rise maybe 3 or 4%. that's wonderful for footballs. so that -- financials. so that's the area if you're not in, i would get in right away for 2013 even though it's already started to move and has moved the past six months. liz: okay, so you're saying double down on financials, but what is the financial sector of 2013, larry, i mean, what is that outlier that will do beautifully as well? >> well, i think the outlier's going to be something like bank of america which has doubled in -- liz: how is that an outlier? >> well, it's already gone up 100%. people are going to say i don't want to double up on something that east already gone up 100 president. i still think it's got a lot more room to go higher given the what we're going to continue to see in the housing sector. david: bill greiner, natural gas, a lot of folks -- we've got wilbur ross coming on later on,

he's investing in natural gas in china -- is that one sector in particular that we should look for plays in? >> we think it really is. and it's great to be coupled with a firm and an individual like wilbur with ross on this issue. of it's very food company, as far as i'm concerned. we very much like mops, master limited partnerships investments and also china. of you've mentioned mr. ross is very keen on china in general perhaps. we are, too, and we really expand that out to asia. we like the asian markets going forward into 20 and simply because the world is starving for growth. this is ab area of the world where growth is probably among the strongest in the world, and that's an area we think in 2013 that should do reasonably well. liz: sandy lincoln, look at these markets over the past year. you have double-digit games for the s&p, for the russell 2000, for the nasdaq. do we see that again in 2013, and are you very bullish going ahead?

[laughter] >> i don't know about very bullish, but i think cautiously bullish. if you go back to november 1st, markets have basically gone nowhere in november and december as we dealt with elections, the fiscal cliff. even last friday we were off 158, we're up 158 today. i think the key here, liz, is if we get a fiscal deal that really addresses the long-term trajectory, that might be the final piece of the rubik's cube that could take markets up to double-digit gains for 2013. otherwise we think the market delivers a 6-7% return for the year, tracking performance of earnings in the s&p, for example. david: sandy, you're staying away from some of the big names. i'm interested in why you're staying away from the big names and then why in particular -- one of my favorite movies from 2012 was "hunger games," and, of course, that was produced by lion's gate. we'll get to that in a second. [laughter] why stay away from the big nerves in 2013?

>> well, i think investors are well served by being diversified. i thought it might be fun on new year's eve to have some names that's been on the beaten path, the big dividend payers and the global foot prohibits, so we brought some names that have a more domestic foot print. and the thing you really want regardless of big or small are companies that are executing their business and have a business that dominates their market share. that's what we're looking for. liz: okay. that brings us back to bill who is more cautious. you're looking at a possible recession here, there's a decent enough chance that we would see a recession. that said, how are you investing your clients' money? >> looking for very high quality and decent values, and one of the names we've been moving towards for a period of time now is apache petroleum, selling about one times book value, seven times we werings. and this is a company that historically has been a very high quality player. a quarter of two of fairly

negative comparables on earnings and then sometime probably middle of next year overgoing to start to see earnings acceleration out of apache. so pick your spots, pick your quality and stay with it. david: sandy, we mentioned lion's gate. angie's list, why do you like that? a lot of people are saying that's the sort of stuff that is very iffy at this stage of the game on the internet in. >> they've got a unique position in the internet space, david. and the space that they have is unique is they have service providers on a regional basis lined up with members on a regional basis. so if you're looking for services for home or lawn care or health or auto providers, you can get verifiable referrals. those service providers advertise, that's one stream of income into angie's list. the other is the membership. and this is a company that's exploding top-of line revenues. they just went public in 2011. we think a really quality internet space is an attractive

entry point probably turn profitable in the next year or two. they've been investing in the top line almost exclusively, and they think a really quality play in the internet space. liz: good to see all of you. let's see if we can have positive predictions going into 2013. bill greiner, sandy lincoln and, of course, larry shover. david: well, it's not just the threat of taxes rising next year, about 28 million families will owe the irs billions, more than expected, for in this year. it could include you. coming up next, liz macdonald with all the information about whether you're on this list that you don't want to be on. liz: plus, not many investors are willing to come back and look at tear predictions from a year -- at their predictions from a year ago, but we found one, teddy weisberg was on with dave and boldly predicted an exact number for the dow on this day. hear how close he came, coming up. come on up, teddy. we'll be with you in a minute. ♪

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biotene helps moisten those areas that have become dry. those that are suffering can certainly benefit from biotene. david: well, one year ago, january 2nd to be exact, teddy weisberg of seaport securities joined me with his predictions on where the dow would close out the year. take a look. a year from now how many more points will the market lose or

gain? let's just keel with the dow for the -- deal with the dow for the moment. teddy, what do you thinksome. >> >> i think the dow will be up 8%, so that's going to put it around 13,000. >> around 13,000. david: unbelievable. teddy. >> liz: yea! david: today the dow crossed 13,000 seven times. it ended up a lot higher than that, actually 13,100. but it literally crossed 13,000 -- i won't ask you how you did it because you absolutely tagged it. but where it will be a year from now? we know how good you are, where will it be a year frommed the? >> well, you know, david, even a blind squirrel finds an acorn every once in a while. david: go ahead, where will it be in a year? >> i'm kind of thinking up 12% next year which would put the dow around 13,646 which'll be slightly above its record closing high of 2007. liz: can you make a guess on the

nasdaq? >> you tell me what apple's going to do, and i'll tell you what the nasdaq's going to do. liz: let's remember you said that. and, teddy, can you tell me if the cleveland browns are going to get to the super bowl next year? >> liz, let me look at my crystal ball. david: who would have thought the redskins did as much as they did? by the way, teddy, i've got to ask, apple, do you think apple's going to come roaring back in 2013? >> well, it's not a stock that i own, and regrettably, i wish we did own it. but i think a stock that we do own which could be very interesting next year, take it for what it's worth, i think it might be facebook. david: okay. teddy weisberg, you nailed it, my friend. 13,000 on the button seven times on this very day. teddy weisberg. liz: happy new year, teddy. >> happy new year to you guys and all the viewers. thank you. liz: teddy's been a great friend to our network since day one.

david: we love him. liz: a provision adopted decades ago to insure that the wealthiest americans did not avoid taxes could cause a lot of grief for all taxpayers. david: so how could it affect your wallet? liz macdonald joining us now with the details. liz, originally this was meant to effect no more than a couple dozen people. >> reporter: yeah, exactly. in 1969 it's called the alternative minimum tax, and it was supposed to make sure that the upper brackets pay some kind of tax, right? but it's basically hitting more of the middle class, and if we don't get this deal done, it'll hit 8 million mid -- 28 million middle class taxpayers meaning $86 billion more will be taken out of their pockets on top of the hike in their rates. i'm saying if the deal doesn't get done. we're hearing word out of washington that there may be a permanent fix to this where the middle class is completely protected going forward forever. but, you know, forever is never a done deal in washington d.c. so what the h&r block is saying

for these 28 million middle class taxpayers their average $1100 tax refund could turn into a $1400 tax bill if they make 85 grand and have two kids. california, new york, new jersey taxpayers have to really watch out, because that amt will hit those guys hard. liz: okay. the fact is we've been doing a patch forever and a day on this amt situation, and like the fiscal cliff if we have to revisit this in another year, how serious could this eventually become? >> reporter: you know, it's an important question. forever and a day is a great way to put it because, yeah, i mean, congress has been doing this annually, picking it, fixing it as an afterthought. they've got to put it permanently in the tax code. and i'll tell you something, even on top of that we know that a number of obamacare taxes kick in, five of them. that's costing $36 billion of payroll tax increase will come into effect and hit the middle class. 70 separate tax breaks expire, that could effect the middle

class too. but it's this one that's most serious because the mitt middle class will find that it's an unexpected tax wol lop that they've got to be careful. for secretary treasury geithner warning about it, we're going to be staying up-to-date. right now there may be a permanent fix to the amt protecting the middle class going forward. david: e. mac, thank you very much. liz: despite a short-term deal, the farm bill, yeah, the farm bill may not be approved before year's end. could $8 milk be in store? david: and he was behind the scenes at the white house for years as an adviser on all things economic, so what is his advice now on the fiscal cliff negotiations? former white house council economic add misers chief -- advisers chief ed lazear coming

up. ♪

david: folks, we are seven and a half hours, trust me, before we go off that fiscal cliff. is there time for any deal? there may not be time to cut a deal of any kind. rich edson on the very latest of the timing of all of this. >> reporter: there might not be time to get it through the house of representatives tonight, basically saying

they're going to have a conference meeting, and then they'll vote on what are known as suspension bills. they're not the fiscal cliff deal. and then they walk off the house floor between 6 and 6:30 p.m. now, this is an acknowledgment that they haven't gotten any type of deal for the senate. the senate is very much the first the act here, so we're still waiting on a deal between the white house and republican leaders. then the senate would vote, and it would go over to the house. this is somewhat of an acknowledgment that there has been no action from the senate yet, and it's not on the calendar tonight, and very likely we are going to go past that midnight deadline without having a deal pass the house and the senate and go to the president's desk for signature. but still everyone in the house is waiting on folks in the senate to act, and it's all stuck by these spending cuts that the white house and senate republicans continue to argue about. but it appears as though at this point we're going to make it past midnight and probably won't have something past both houses of congress meaning technically, we will likely head over that fiscal cliff.

liz: do you need us to order o you pizza, rich? >> reporter: if you could, that'd be great. though i don't know how you get a pizza in here. i don't know if there's an address -- liz: run out to the street. we'll let you know. la of laugh. david: thanks, rich. liz: if a deal is not reached, higher taxes won't be the only thing hurting americans' wallets, your milk prices could double as well. david: so how much and when can consumers expect to see dairy prices rise? jerry is senior vice president of economic and legislative affairs for the international dairy foods association. jerry, all of this surrounds the topic of the government involvement in the price of milk. and that's really the the biggest question of all, is why should the government be in the business of manipulating milk prices at all? >> we don't think the government should be in the business of manipulating milk prices. that's actually one of the things that's being threaten ld right now, that the government will raise the price of milk, taking actions to do that. and really when the government gets involved in the supply and

demand of a product, that's just not the way to provide support for the agriculture community. there are other ways to help like insurance and things like that without manipulating the price of milk and causing it to go up for everybody. liz: let's get into the details of this, though, this 1949 agricultural act that kicks in and, in essence, it says -- and if people can wrap their minds around it -- if there isn't a deal, that sort of kicks in. it was of a plan that milk would be hit with $38 per hundred weight. currently people are paying $19 per hundred weight. can you explain what that means? >> congress never repealed the 1949 act, they just replaced it temporarily. so we're going to go back to agriculture policy that's 60 years old. and how it would be implemented is that the secretary of agriculture, tom vilsack, would need to implement regulations, propose regulations to start

purchasing dairy products off the shelves so the price of milk raises accordingly. now, we think it'll take a little time for him to pass that type of a regulation because he needs to decide what type of products to purchase, where to purchase them, how they'll be packaged. so this won't happen immediately, and a lot of the timing will be up to the secretary of agriculture. david: jerry, i hope i'm not repeating, but i've just got to focus on the irony here. here we have a government that is spending billions and billions and billions of dollars to reduce food costs for things like -- through things like food stamps, for example, and then that very same government is doing things to try to increase costs. i mean, you're talking about government waste, on the one hand they're spending billions to do something, then they're spending billions to do exactly the opposite. just get rid of both sides of that equation. >> are well, i certainly agree with that. it's interesting that one of the things that's holding up the farm bill is that they're trying to pass a policy called the dairy security act that artificially will raise milk prices for consumers.

this is one of the things that's major issue in the farm bilker and it's one of the reasons that the farm bill's still being debated. so we have this threat of raising milk prices being put in place to pass a program that will artificially raise milk prices. and it does that by limiting the milk supply. liz: jerry, this may be a dumb question, but does this apply to powdered milk? >> certainly, it does. what they're going to do is apply a supply management program that will limit the amount of milk that's available to milk -- food manufacturers, dairy food manufacturers. and when you limit the amount of milk that's supplied to them, prices will go up. so, and if prices go up for my -- excuse me, my manufacturers, they're going to go up for consumers as well. my manufacturers make everything from, well, we make cheese, bottled milk, ice cream. my companies who i represent don't necessarily make powdered milk, but that's certainly something that would be made from whole milk that the price

would increase. david: you know, when you're asked the simple questions, you realize how ridiculous most of what the government is doing, particularly in this area. jerry, thank you very much for coming in. appreciate it. >> thank you. and happy new year. david: happy new yore to you. well, time is running out to make some kind of deal to avoid the fiscal cliff. it now looks like no votes today. coming up next, former chairman of the white house economic advisers, ed lazear, and why tax hikes are not the answer. liz: the stakes are high. wilbur ross says we could fall into another recession if a deal can't be reached, but guess what? he's investing nevertheless. he's and comparing us to greece, but either way we'll find out what he's buying. he's joining us live later this hour on the phone. you don't want to miss it. ♪

david: let's get down to basics here. is there any notion of reality still working inside the beltway at all? yesterday the president said the following in terms of what he is doing cutting spending. take a listen. >> if you look at my track record over the last two years, i cut spending by over a trillion dollars in

2011. i campaigned on the promise of being willing to reduce the deficit in the a serious way, in a balanced approach of spending cuts and tax increases over on the wealthy while keeping middle taxes low. david: okay. i don't know if this is fantasy, a wish-list or what but look at this chart but what actually happened with spending since the president came in in 2008. it has gone up by 20 to 25% and it stayed there, year after year. so if we can't agree what has actually happened in terms of spending, how can we agree about what should happen? let's ask former chairman of the president's council of economic advisors edward lazear. joining us on the phone. i don't know if you saw that interview on "meet the press" yesterday, but when i heard the president say that, that he cut spending by a trillion dollars in 2011, i was wondering what planet he was on? >> yeah, i don't know what his reference point is but he certainly didn't cut

spending. if you go back to the period of say 2007, the year before the recession, at that point we spent less than 20% of our gdp in government spending. and if you look at the period during the obama term, it's been at 24% as high as 25%. so it certainly hasn't come down. so i don't know what he was referring. david: what happened is and i'm looking right at federal outlays right now, we can put it on the screen. we had the big jump because of stimulus 2009 which' greed part republican, part democrat but it stayed there. it doesn't go down. it went up in 2011. not down. the basically -- baseline is now this and that's why the president needs all new taxes. >> if you look at change in deficit past two years we have upwards 9% deficit or

so per year and part of that of course is a result of the recession. when you have a recession, tax revenues fall. so if he fell from 18 1/2% down to 15% but the big, bigger component of it was just the one you mentioned was the discretionary increase in spending from 20.8% to 25% during the first year. david: yet we just heard today, i mean god knows what kind of deal they will end up with, windmill subsidies. windmills have failed terribly. it is more expensive to get energy from windmills today than it was $24 billion, 20 years ago when the subsidies began. we agreed to spend more money, another year of spending on windmills. >> that's right. i looked at this at each of the budget items we have increased over the past few years and if you look at it specifically, virtually every agency has had a significant increase in the size of their budget and again, i think is not a stimulus issue. this is really a desire of the president and the,

president's party to grow the size of government. this is something they have wanted to do for a long time. and, 2009-2010 was their opportunity to do it and they did it. so that is kind of where we are right now. the question then is, what do we do from here on? i think there are plenty of things we can do. not to say they won't get done. david: talk about what is realistic what is getting done. president also said yesterday, i'm quoting him here, you will not cut your way to prosperity. i guess he believes the government, you can spend your way to prosperity. we're all hoping for prosperous 2013. let's hope it is. is it conceivable despite the tax increases all of them, we won't go into detail, we could still get a prosperous 2013. >> i don't see how. the reality we haven't had a prosperous, 2009, 10, 11 or 12. raising taxes and expecting for prosperity in future is not a path to success.

my view and one most economists would have, in terms of the long run, the only way to get the budget under control is on the spending side. if you take the president's numbers which is what i always like to do, president is forecasting that in a couple of decades we'll be spending upwards of about 28% of gdp through the government as a result of entitlement growth. in order to finance that on the tax side you would have to increase the taxes of the average american by about 50%. so everybody's taxes would have to go up by 50% in order to finance that. that is not a recipe for strong long-term growth. david: okay. ed lazear, former chairman of the white house council of economic advisors. ed, great to talk to you. let's hope and pray for a prosperous 2013, ed. >> thank you and happy new year. take care. liz: that is what everybody is asking, are we going over the cliff or not? the clock is ticking down now, we're wonder what would happen and what are the smart money people doing? legendary investor wilbur

ross clearly one of them. he says the real question is how steep the cliff will be. he is joining us ahead. david: look at these three guys. we'll take you behind the scene and talk to three congressman what they need to see in order to get behind any deal and whether they think we'll get one. that is coming up. ♪ . ♪ [ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa,

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liz: the framework, the skelton, is set for a deal on the fiscal cliff but congress still has to vote on it before this goes into efence. -- effect, let's bring in our panel of congressman with expertise on this. mick mulvaney of south carolina, tim huelskamp kansas and dennis

cue cues ohio. you've been leaving congress. you've been term-limited by voters. i know you're general in favor of what you would call a more fair tax system. the top 3%, everybody earning $250,000 or more, pay about 60% of all the federal income taxes that are paid. 3% say, 60%. how much more do you think they should pay before it is fair? >> well, the choices we've been given aren't the best choices, i will tell you that. we ought to be creating more taxpayers. we ought to be talking about jobs. david: i agree. bingo. >> how is it that we've avoided this discussion? all we're talking about is getting more money of people working right now. so, you know, there has to be some kind of a cuttoff about preserving the current tax cuts. i opposed the bush tax cuts because i thought most of the benefits were accelerated to top. we need a more fair tax system. you know what? bottom line, job creation,

wealth creation. get america back to work. get our economy working again of the these machinations we're doing right now have nothing to do with that. liz: suddenly putting off for a year the sequestration, the actual cuts would be very much bringing down a part of the deficit. to you, congressman mulvaney, you said there are certain feelings you have you would put them aside i will give up on this if i could get another portion of this what would you say yes to that you would feel a little uncomfortable about you about in the spirit of compromise, okay, i'll do it. >> right. and by the way, what you just said is the first i heard about the sequester going away for a year. i heard three months. that is first i heard for a year. that would be very troublesome. what you would like to see something that is clean. if we're going to talk about tax rates, that's where we are in the last couple hours let's talk about tax rates. let's not add all of this wish-list that things democrats, president would like to see. let's not additional stimulus. let's not delay the

sequester. if we're going to focus on one thing focus on one thing to see at least if we agree on that. we're try to get to a yes but if this ends up being christmas tree on christmas eve or new year's eve i think it i will difficult in the house. david: tim, you're kind of knew there, the fact that some people are so keptal about what is happening they're saying the president wants us to go over the fiscal cliff, that way taxes will go up for everybody and he will come in say, okay, i want to have the obama tax cuts for the middle class. no more will we hear about the bush tax cuts. from now on they will be the obama middle class tax cuts. do you believe that? >> well, don't forget the obama signed extension of these very tax cuts two years ago and said you don't raise taxes in the middle of a recession. we estimate a million small businesses will see their taxes go up. i can't find a single maul business owner that says if you raise my taxes i will hire more people. we should talk about growth

and opportunity. there are three strikes against the plan as i see it. it will raise taxes. possibly put off any spending cuts. david: you're not answering the question. do you think the president, as a political tactic wants to go off the fiscal cliff so he can come in as a tax cutter? >> oh, i think he does. he wants more revenue. whether he wants to cut those taxes when he is done. when you're running 1.3 trillion dollar deficits you got to have more revenue if you're going to shrink that deficit. liz: gentlemen, why is it okay if george bush wanted to cut taxes and not if president obama wants to cut taxes? at a certain point nobody loves taxes. however, married with spending cuts, why are we not hearing about that dennis kucinich? the spending cuts we need to see as well. >> i vocally opposed the bush tax cuts, look how are you paying for them? we're borrowing money from china to give tax cuts? what is going on? as far as spending look at amount of money wasted in pentagon. wars in iraq before all the

bills are in. liz: well, 800,000 pent -- pentagon workers may be cut, may be furloughed due to these spending cuts. the question becomes all of you, maybe that is our version of austerity? maybe we need to feel that pain? >> these cuts were --. liz: let me let representative mulvaney get first crack. >> let's try to find still very lining here. what we've learned from the american publlc during the last two weeks is as attention turned to the fiscal cliff, they don't want their taxes to go up. i get it, dennis gets it. everybody gets it. people don't want to pay more taxes. if you want to get rid of the deficit, ray taxes and cut spending. people said don't raise taxes. that only leaves spending side of the equation. the president needs to get the loud and clear as loud as he got it on taxes. maybe there silver lining. maybe we bring some

long-term solution in the future. david: i don't see a silver lining coming out of washington. but, congressman huelskamp, the reason i don't, i've seen all the promises broken in the past. the promise of three to one in terms of spending cuts to tax increases during the reagan administration. bush's two to one or whatever it was. all of those promises are broken. if the government gets more money, it will spend that money. it will not put it to pay down the debt, don't you agree? >> i agree. listen to what the president said a couple hours ago. he talked about sequestration and how bad those cuts were as if he hadn't signed the bill that did that. this was just 17 months ago. these are the first cuts that were to occur because of raising the debt ceiling. now they want to undo those. that's why folks, washington is all messed up. they promise spending cuts and don't deliver. david: let's put it to dennis in. he and i know each other a long time. we're friendly with each other. we like each other. dennis, can you ever point to a time when more revenue was paid to pay down the

debt? i'm talking more revenue? i'm talking about savings during the clinton administration because he had a lot of extra money coming in. will the new taxes, new tax money going in help to pay off the debt? >> that remains to be seen. i'm for priming the pump economy and getting more people back to work. then, rising tide lifts all boats. the whole direction we're taking with this economy is the wrong direction. we're, we keep talking about tax increases. how about getting people back to work? liz: well, yeah, of course. then to you, representative mulvaney, we had former treasury secretary paul o'neill come on the air said look, figure out what your revenue is going to be and size the government to that. we all understand business here at this business network. you don't spend more than what you have. so at what point are you going to really look at the spending cuts and say, you have got constituents who voted you in say, yeah, but don't touch my medicare. how do yyu deal with that?

>> if tim and i had our way you would have started two years ago. i like dennis. we'll get along fine. i think we'll be less of a body what when we leaves. what you heard was code, that is priming the pump, spending. that is difficulty, folks on other side of the aisle and folks who dominate on the senate and gentleman in the white house feel the same thing, only way you put people to work is spending more money. until that changes, people in the offices or way those folks think this town will not change. we have to figure out a way to get spending under control. the only way it will change when people back home will sinned the message to officials. david: dennis kucinich will your last vote for the u.s. congress at least this time out will be for this debt deal? >> i want to see what the deal is. you never commit what your vote will be until you read it. i will say this if the private sector isn't creating jobs, the public sector has a moral obligation to help get

america back on its feet. china just, is investing billions of dollars in high-speed rail. what are we doing here in this country? we should be rebuilding america. have more taxpayers and quit putting increased burden on taxpayers. >> then raise the taxes. liz: will we have a deal tonight? >> dennis, raise taxes to pay for it, please. take that position and come out and say raise taxes to pay for it. stop borrowing money to do what you said. liz: representative humans camp will we have a deal? >> no time to finish that. irs moved back withholding tables. there is still a few days. deal that raises taxes increases spending and ignores entitlement reforms i'm a no on any deals. david: no on deals from all three of you guys. wish we had better news to report but happy new year. keep it real at least for the new year. congressman huelskamp, mulvaney and kucinich. liz: thank you for your presence on the show. >> thank you. liz: while the world is

watching the clock closely while we face the fiscal cliff deadline, wilbur ross says there is looming deadline that could cause the u.s. to face a greek-style debt crisis. he joins us next

liz: let's face it. we're down to the wire. just hours from falling off the fiscal cliff if no deal is reached. right now a deal does not seem likely. even if they came out said, hey, news flash, it is here. not enough time to vote on it. will u.s. economy fall back into recession? either way what is the smart money doing? where are they investing? joining me now, billionaire investor wilbur ross. ceo and investor. >> you're welcome. >> will there be a deal of any kind and what does it

really mean for the markets? >> what i'm worried about they make a deal but won't be a sensible deal. that it will kind of put some sort of a permanent cap as to the level at which the bush tax cuts are repealed, extend for some short period unemployment, extend a few other things and not really with the big issue. punt it over and mix it up with the debt ceiling talks which will be coming up sometime between now and around the end of february. liz: well, yeah. timothy geithner, treasury secretary, warning that we will hit the debt limit today. obviously that is a big issue. is that a bigger problem than the fiscal cliff expiration here? >> well, they're both tied to each other but i think what secretary geithner actually said was that in a technical sense they're there because they reached a borrowing amount. liz: right. >> i don't think he said we have any danger of going

into default until another couple of months goes by because of all the little steps that he is able to take to bridge things. so i don't think that we're talking about simultaneously fiscal cliff, and, a debt default. liz: wilbur, you have the uncanny ability to put down a lot of fear and invest anyway. even if we face a greek-style problem, recession again. what do you like to invest in natural gas, with certain regards you were making investments there. tell us what you like going forward into the new year? >> i really like the natural gas, the shale gas activity. -pand the reason i like it is it's the one thing that could be a true economic game-changer without requiring one penny of federal assistance. it could move us toward energy independence. could cut our balance of payments deficit.

could create hundreds of thousands of jobs. could let us be an exporter of chemicals and other products. could result in vast capital expenditures in chemical and plastics industries. and finally, could lower the cost of electricity both for manufacturers and consumers. it could put a few hundred dollars a year more in the pockets of every-day people. that is something that would really be good for the economy quite independently of all these other moves. liz: we have about 10 seconds left. if we don't get a deal and we do get one of the, fitch ratings agency or perhaps moody's downgrading the u.s., will it be awful, yes or no? >> well, i think a downgrade will have very little effect where the bond actually trade. liz: we've got to go, wilbur. happy new year. david: happy new year, wilbur. >> happy new year